Do state visits affect cross-border mergers and acquisitions?

Aleksanyan, M. , Hao, Z., Vagenas-Nanos, E. and Verwijmeren, P. (2021) Do state visits affect cross-border mergers and acquisitions? Journal of Corporate Finance, 66, 101800. (doi: 10.1016/j.jcorpfin.2020.101800)

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Abstract

This paper studies the relation between state visits and cross-border merger and acquisition (M&A) activity. Based on 1161 state visits and 11,531 cross-border acquisitions, we find that corporations from visiting countries are more likely to acquire corporations in countries hosting the visit. Domestic acquisitions in the host country or M&As with non-visiting countries are not elevated. Evidence from instrumental variable analysis points towards a causal effect of state visits on M&A activity. Further analysis shows that the elevated M&A activity originating from visiting countries can be attributed to business networking and a reduction in investment uncertainty and cultural barriers.

Item Type:Articles
Status:Published
Refereed:Yes
Glasgow Author(s) Enlighten ID:Aleksanyan, Dr Mark and Vagenas-Nanos, Dr Evangelos and Hao, Mr Zhiwei and Verwijmeren, Professor Patrick
Authors: Aleksanyan, M., Hao, Z., Vagenas-Nanos, E., and Verwijmeren, P.
College/School:College of Social Sciences > Adam Smith Business School > Accounting and Finance
Journal Name:Journal of Corporate Finance
Publisher:Elsevier
ISSN:0929-1199
ISSN (Online):0929-1199
Published Online:30 November 2020
Copyright Holders:Copyright © 2020 The Authors
First Published:First published in Journal of Corporate Finance 66: 101800
Publisher Policy:Reproduced under a Creative Commons License

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